Mobile Payments to Take Flight as Airlines Add More Payment Options
The majority (71%) of airlines believe the future of airline payments is in mobile, according to a new survey, and more than a third (36%) of them plan to accept mobile payments on-board flights within the next two years. The number of airlines accepting mobile payments increased from 10% in 2012 to 25% last year, based on the survey of 68 traditional and low cost global airline carriers by WorldPay.
Airlines already provide a number of services by mobile and more appear to be on the way. As any frequent flyer knows, most airlines have mobile check-in and the survey found that 71% expect to within two years.
The reasons pushing mobile payments along for airlines are somewhat split, with half (50%) seeing it as a way to keep up with competitors and almost as many (45%) as a way to increase revenue.
Airlines expect that extra revenue to come from a number of places within the next two years:
- 55% — Paying for a flight
- 55% — Ancillary sales
- 47% — Buying an upgrade
- 42% — Buying baggage allowance
- 28% — Paying for onward travel
- 26% — Buying inflight good and drink to consumer on board
- 20% — Buying inflight duty free goods
BARRIERS TO MOBILE PAYMENTS IN AIR
Mobile payments also present airlines with a broad range of challenges, with the risk of fraud at the top of the list. Here’s the complete list of challenges, based on the Alternative Payment and Distribution Landscape report:
- 65% — Risk of fraud
- 65% — Integration with current systems and processes
- 63% — Diversity of mobile platforms and operating systems
- 51% — Payment security
- 44% — Data security
- 37% — Availability of resources for implementation
- 30% — Cost to implement
- 23% — Insufficient evidence for ROI
- 12% – Selling in to the business internally
- 7% — Less visibility due to outsourcing/partnering
- 7% — Customer understanding and/or enabled equipment
Ad-ology Research has discovered that m-commerce shoppers are more likely than average to participate in social networks and follow brands, and are also more likely to make an automotive or home-related purchase within the next 12 months. And while television advertising has the most influence on this audience, m-commerce shoppers are significantly more likely to respond to daily deals (like Groupon or Living Social), mobile smartphone app or text messages, and ads on a social network. These formats may be a great way to connect with this audience, as 68% of m-commerce shoppers plan to travel inside the U.S. within the next 12 months.
AudienceSCAN data is available as part of a subscription to Ad-ology PRO. Media companies can access AudienceSCAN data through the Audience Intelligence Reports in AdMall.